How does the "Rule-based yield distribution" function work?
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If you have different rules according to which you distribute the income among your employees, you may need to activate the rule-based income distribution. I will explain how this works in the following article.
Activate revenue distribution
After the rule-based income distribution module has been activated for you, make sure that under Settings - Parameters - Finances - Debtors the check mark is set for INCOME DISTRIBUTION.
Create revenue accounts
The idea of rule-based income distribution is to distribute incoming payments according to certain rules. This distribution is done by posting to different revenue accounts. Therefore, in a first step, you must open a personal revenue account in the chart of accounts for each clerk to be benefited. Each clerk then receives the share of the income to which he or she is entitled posted directly to this account.
Assign revenue accounts
Next, you should assign each clerk to be benefited his or her personal account. You can do this under Settings - Basic data - Clerks. Open the respective clerks there and select the corresponding account. Of course, you can also set up a general revenue account for the law firm (a partnership pot) and assign this to those clerks who should not have a personal revenue account (e.g. associates).
Prepare performance groups
Not all benefits can be distributed from the total. Therefore, service groups for expenses, costs, etc. can be excluded from the distribution of income. You should therefore go through all service groups once in preparation and set the checkmark Exclude from revenue distribution for all service groups that are not to be covered by the distribution algorithm.
Define distribution rules
Go to any client and open a client with a double click. If you now go to the Invoicing tab, you will find a new symbol next to Income account. Click on this symbol to open a new window in which you can enter your income distribution.
Click on the grey plus sign at the bottom right and enter the first specification of your rule. In our example, the canvasser should receive an acquisition share of 10% of the total turnover for four years. To do this, enter the percentage in the first field (the remaining share of 100% is shown in italics below) and enter the name for this share in the second field. This name will be visible in the accounting. If you have already created some rules, you can also choose from a list of already used designations by clicking on the black arrow next to the designation.
In the drop down menu To favour, you can select who is entitled to the share. In our case, this is the canvasser, but you can also select from all the designations and employees of your company.
In the following menu you can select the account to which the share will be sent. If you select Automatically, the stored account for the selected clerk will be used for this purpose.
In the menu of you can define whether the share depends on the total turnover (usual) or on the own income.
Finally, you can limit the validity of this setting with a tick. To do this, a window opens in which you can enter the date on which the default expires.
Click OK to save the preset. You can add as many defaults as you like. Please note, however, that the total 100% must be distributed at the end if you do not want the income received to remain in the standard income account.
In our example, we have then allocated 5% of the total income to the mandate leader and the remaining 85% to the clerks according to their turnover.
All three specifications together form the distribution rule. You can now save it for further use. To do so, click on the cogwheel in the top right-hand corner and select Save Rule..... Enter the name of this rule in the following window. This name is only internal and cannot be seen by the client. Now you only need to click on the cogwheel in the next mandates to call up the rule saved in this way.
Click on OK to close the window and the symbol next to the income account is now blue. This tells you that the rule is now active and will be applied.
Also make sure that the beneficiary employees are defined under "Overview" - in our case these are canvasser and mandate leader. Otherwise, the percentages of income defined for them will end up in the income account without allocation.
Apply distribution rule
Let's now create an invoice and see how the rules are applied in the programme. The invoice can be created normally, as you are used to. In the invoice sheet you still have the possibility to change the distribution rule for this specific invoice via the now familiar blue symbol next to the income account. The original rule in the mandate is retained and will also be applied to subsequent invoices. Otherwise, the invoice sheet still looks exactly the same as all the others.
You will see the effects of the distribution rule as soon as the incoming payment is booked. timeSensor LEGAL now immediately distributes the amount received to the defined persons according to the rule.
On the Accounts tab in the dossier, you can also see that timeSensor LEGAL has not only distributed the income according to the rules, but has also correctly deducted the VAT from each partial amount. In the picture we see the overview of the account of the client manager Michael Muster.
Now it only remains for you to determine for all remaining mandates whether and which distribution rule should apply to them. Do not forget to make use of the possibility to save rules.
Of course, each partner would like to know how much share he is entitled to. For this purpose, you can print out the account sheet of each beneficiary's personal income account in the bookkeeping.
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